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tv   Maria Bartiromos Wall Street  FOX Business  March 18, 2018 7:00am-7:30am EDT

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you'd like to share with us? we'd love to hear it. send me an e-mail or go to our website, s weekend. welcome to the program that analyzes the week that was and how to position you for the week ahead. i'm maria bartiromo. we have a special guest on tap to week, charles swab. first, jerry has all of the headlines. ra>> t war worries and political uncertainty wghs on markets this week. stocks gang on friday after a dismal four-day losing streak. but all three indexes closing in
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the red for the week. the fed is scheduled to hold a twof two-day policy meeting next week with investors largely expecting a mayor rate hike. other headlines grabbing investor attention, rex tillerson is out. in a shocking tweet, the president announced he was firing his secretary of state writing, mike pompeo, director of the cia will become our new secretary of state. he will do a fantastic job. thank you to rex tillerson for your service. congratulation to all i was only a 51-49 republican majority in the senate. pompeo may face an uphill battle in his confirmation hearing. and the shakeups in the trump administration keep on coming. president trump tapping larry kudlow as his new top economic adviser after gary cohn resigned from the past last week. kudlow has been publicly critical of president trump's push for sweeping tariffs on
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steele and aluminum imports. six people are dead after a 950-ton pedestrian bridge collapsed on to a six-lane highway on florida international university's campus thursday afternoon. the bridge was scheduled to open early next year and designed to with stand hurricane force winds. back to you. maria: thank you so much for that report. my guest this week has played a huge and critical role in helping to shape today's investment world for five decades, charles sha want has been a leader. to help average folks make the best decisions with their money and portfolios. with over $3 trillion in in assets under management, it's the country's largest publicly traded investment services firm. charles is a legend. >> thank you.
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always a pleasure for me to be with you. maria: you've seen lots of ups and downs in this market. so that's where i want to begin. are you surprised to see the volatilvolatility this year, a w concernant wageconcern about wat rates going higher. what is your customer base saying? >> i have to say, we couldn't be more confident about our future. we have in place a president that understands the economy, understands what makes greatness happen, understands what creates all of the issues about growth, entrepreneurship, the kinds of power that individuals have and let them go with their ingenuity. that's what happened to the economy. we have unleashed this very powerful machine with the tax bill, probably as number one. but also the reduction of some of the regulatory crushing
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things that were happening to americans in terms. so we're on a pathway for incredible growth. i think it's wonderful for the young people. there's going to be opportunities for them to come into the workforce, see their growth in terms of their salaries, in termsf their responsibiliti, in tmsf new things to be done. maa: yeah. i think you make a lot of great points. i want to come back to policy. whether it's the tax plan, the rolling back of regulations, this president has high marks in terms of the policies. but there's the worry about the trade tariffs which we'll get back to. tell me about what's at our corporation. you've been investing in new technologies trying to enable new things for investors. tell us where the growth comes from there and what changes you've made. >> well, thank goodness in many ways i was lucky to have start the company in san francisco. it is a mecca of innovation and technology.
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i embraced that way back as a young person, technology being the savior to what we could do in the financial services world, make it more efficient, make it quicker, make it more accurate. all of the things that allowed us to increase our client base, meanwhile deliver fantastic service. so technology has been the heart and soul of our company from the day one. today we still do the same thing we have a big news center that we just developed in austin, texas, three buildings going in place there all devoted to technology. and across the country we're just -- we have embraced technology completely. and i think our customers really enjoy i maria: so you've invested in infrastructure, technology and thoverall cent experience. >> yes, exactly. and we have, of course, many engineers who work for us and we're always designing new tweaks, new kinds of services that we think will benefit our clients and we try to be on the cusp, on the edge all of the
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time of new things that will make their life easier, better and more comfortable. and so whether it's financial planning or whether it's just a simple transaction, count on us. maria: i find retail investors today are smarter than they've ever been. >> goodness gracious. i wish some of that would be happening in schools too so that the younger people could get the benefit of a financial education. i don't know what's happening in our public schools. it's not happening yet. maria: you're right. financial literacy is something that we've talked about that we agree on that is necessary np in terms of investors today have they been scared out of this market with the 1,000-point becline. what are you seeing from your clientele? >> i think they understand, markets in general go up and down. you have to be a long term investor. we add money to each account as we earn our money and put it aside, put it into the 401(k)
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or whatever it may be. and over three, four, five-year periods, these little movements don't mean anything. you look back and go oh, that's great. i bought it at x and now it's x plus two, whatever it might be. so i think people understand the volatility of the markets. maria: does the growth come organically in the next five years or more acquisitions? >> we are not much of an acquirer of other companies. we've been much more about natural growth. and we open up nearly a million accounts a year. it's pretty incredible and we're at a very fast pace right now. it's so fulfilling toe, as the founder of the company, to see the acceptance and see the number of people, new people, not just -- new to investing actually, some of the younger people coming in. i really enjoy seeing that also. more of maria's exclusive
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maria: what's your take on fees and the expense side of the business? i mean fees are going down, you've got lots of competition everywhere, whether it's exchange trade funds and this race to the bottom, vanguard keeps lowering fees. what's your take on all of this? >> it's a really important thing. that's what the customers need to be looking at. fees takes away from your ultimate return. and from the early days i've always been fee conscious. that's how you get your end result is to keep your fees low. i think today because of technology, fees are near zero in many respects. you have to have the volume, as we do. and fortunately we have lots of
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volume so we can afford to have very low fees. and the important thing is i think we're one of the lowest cost producers in the business. we're sort of like the walmart of investing. we keep our costs very low and we don't have a lot of expenditures and therefore we deliver to our clients a better value. that's what we try to do every day. maria: that's what you've been doing for five decades. i remember the earliest story of your career, you felt bad that somebody lost money and you wanted to give the money back. >> that's why we have the guarantee for our people. not lost in the technology but loss of technology or some invasion by some foreign person, we provide a guarantee for that also. maria: you make them whole. >> we make them whole. maria: that's incredible. you mentioned the policies coming out of washington which are really critical in terms of
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the backdrop. people are expecting s&p earnings to be up 18% in 2018. >> well that's just a result of the tax bill. so powerful what this tax bill is doing for our country's businesses. it's really a very positive thing. and so that 18% is pretty realistic. maria: and it's not an overnight success. this is going to have a long runway. >> ab absolutely. maria: why do you think people are looking at this as far as long term. you don't think some people have been impacted by the tax plan and we'll see the impact over the months . >> companies take time to plan out their large investments, whether you're going to put many a new plant in over here, or in our case it might be a new call center or new branch some place. there's plenty that takes place. it doesn't happen overnight. so t long term commitments are occurring now, plans may be have been in place for a few months
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and we're executing on them now. so the fruition of that particular new entity will really show up six months, 12 months later. so it's -- what we're seeing right now is the seeds are going in the ground and we're going to see the flowering over the next several years. maria: and i think that people are recognizing that it was the right move to actually lower taxes on the corporate level because that creates an environment for companies to hire more workers. >> i what it does, maria, is a massive shift of money from government to private enterprise. and that shift -- we know the power of private enterprise. what they're able to do. the compounding they're able to do, the growth, the spin in terms of activity and entrepreneurship. it doesn't happen in government. so by taking some money from government, lowering taxes, moving it over to private
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enterprise, we don't know how fantastic it's going to be. i think it's going to be very fantastic. wh inwith e look back five years and say why didn't we do that sooner. what happened. and so we're in good shape right now. maria: some people think that the rollback in regulations is more impactful than the tax cut plan. you've been in financial services and you know the burden that you and your colleagues in the business have faced. significance of the rollback? >> well, we all want companies in financial services or any business for that matter, we want to make sure that we don't do anything that would harm somebody for sure. but regulation can get some over, so double, triple, quad ruppable that it doesn't make any sense, wasteful, really wasteful. so we want to have the perfect mix of properegulion that is efficient but not excessive. we're turning the clock back in
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time getting back to an efficient regulatory. maria: i was talking to one ceo recently, he said he just went to new jersey and the bayonne bridge that he wanted to invest in took 13 years. why would anybody invest in a project if you're not getting a return for 13, 15 years. >> doesn't make any sense. and that's the beauty of free enterprise. you have to have a return on capital. government doesn't ever think about that. when we return, more of ma radio ya's exclusive interview with charles schwab. >> we love free trade but it basically has to be fair ♪ no, please, please, oh!
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sure. momwhat's up, son?alk? i can't be your it guy anymore. what? you guys have xfinity. you can do this.
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what's a good wifi password, mom? you still have to visit us. i will. no. make that the password: "you_stillóhave_toóvisit_us." that's a good one. seems a bit long, but okay... set a memorable wifi password with xfinity my account. one more way comcast is working to fit into your life, not the other way around. maria: are you worried about
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what this is all doing to the federal reserve? we're expecting the federal reserve to raise interest rates perhaps three times this year. what's the impact? >> i think we're just returning to normality. it used to be when treasury bills were two and a half, 3%, we're still a long ways from normality. and so what we went through in 2009 and '10 and all that was not a very pretty picture. and so the fed did the right thing that brought rates down for sure. and increased money supply. and now we're just turning back -- we're finally turning back to a normal economy which i think is fantastic. maria: so the fed has to unwind the balance sheet. is that going to be an issue, do you think? >> it will have an impact on longer term rates, although longer term rates are pretty low. very low. so i think we have plenty of running room, plenty of natural movement that will let the fed
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do what they need to do. it's all on the pathway to return to a normal economic situation. and i'm really happy about that. maria: people think 4% economic growth is doable. >> i think it's clearly on point. i see our own company, how fast we're growing, substantially ahead of the 4%. but when you take collectively all of the various companies in america, i think the opportunity for 3 to 4 is very very good. and it could be slightly more than 4. maybe in a year or so. maria: as a manager, what are you see in terms of the wage market. in february it was 2.6% growth. how tight is the labor market? >> it's not as tight as you think. the you look at the real unemployment number, it's closer to 8%. participation rate went from here way down to 62%. i think this thereil be a huge amount of people that wl return to the marketplace as we bring some of the people that are a little bit older, we want
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them to come back in the marketplace. and we have some ideas on maybe getting social security costs down. so if you're 65, we can have that go down to zero. so the next period from 65 to 70 or 75, you can work without paying off the balances that you had in social security. so you'll be able to save more money, make more money and it's a nice incentive for more people to participate in the economy. maria: the participation rate improved last month saying that people had the confidence to go out and look for a job. >> absolutely. and a good job. maria: high-paying jobs. and then you also mentioned that we're seeing the participation rate do well but also the labor force doing well because they're a higher paying jobs. >> exactly. it always works together. and that's what a robust economy really means. maria: what's your taken to trade story. the president is getting
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pushback on the tariffs on aluminum and steel. >> i think he has to establish some negotiating points. i think when you look at china, for instance, taking over the steele manufacturingsteel manuf% of the rogue steel manufacturing. america has gone from very high down to maybe we do one-tenth of what china creates. so china is selling to canada, mexico and so forth. and we have to have a steel manufacturing capability. i mean, just for strategy alone, if we ever get into any kind of a fight and we've been there before, we need to have this capability. so i think, you know, china is really not free trade in so many different aspects. and most countries are not free trade. we love free trade but it's basically has to be fair trade. maria: right. >> so he's doing some right things. i think negotiating points that maybe we can get some things
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done and make it a fairer environment. maria: "the wall street journal" op-ed page was pretty hard on him. >> they're very hard on him. but i think when they really look at how the other countries treat us, they're taking advantage of us and i totally agree with the viewpoint of the administration. maria: so do you still believe that over the long term the stock market is the best way to create wealth? >> yes. and the reason is this. it's the only place i can point to that has continuous growth. when a company -- for instance, apple, perfect example. started with one little device. it grew to two, three, it grow in all of its thousands of things that flourished, so it grow every year, every year, every year over 20, 25 years. same with, let's say mcdonald's, started with one hamburger shop, two, four, eight, ten, that's called growth. that's what you want to look for. and the only place you can get
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that is really in the stock market. if you buy a building, for instance, the building will be there, same building 50 years now, yeah, the rent may have gone up but it's not going to be two building or three billings. but a company can grow and become much bigger in a mpound way maria: that's a great analystgreat to seandanalyst. analystgreat to seandanalyst. don't go anywhere, more hi, kids! i'm carl and i'm a broker. do you offer $4.95 online equity trades? great question. see, for a full service brokerage like ours, that's tough to do. schwab does it. next question. do you offer a satisfaction guarantee? a what now? a satisfaction guarantee. like schwab does. what are you teaching these kids? ask your broker if they offer award-winning full service and low costs, backed by a satisfaction guarantee. if you don't like their answer, ask again at schwab. and low costs, backed by a satisfaction guarantee. feet go here....
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maria: time to look at the big market events coming up in the week ahead. oracle expects to release its quarterly earnings. that typically is a market mover picked tuesday we get the latest earnings from fedex but the market mover of the day is the federal reserve's second meeting of the year. that will set the stage for wednesday when we do expect to hear from fred -- fed chairman about the fed meeting and whether or not we are going to
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see an interest rate increase. it's expected that powell will conduct its first news conference after the announcement and we are expecting the fed to raise the rate by one quarter of a point in thursday. markina: data. manufacturing pmi as well as the latest reports from brand names like nike and conagra brand. friday we will in the week with the latest news on durable goods orders and new home sales. durable good orders those big-ticket items that are expected to last for a long time is typically a market mover as well. the ceo of demko investors is my special guest next week and i hope you'll join us and don't forget john man sunday morning on the "fox news" channel for sunday morning features. we are live at 10:00 a.m. eastern and catch me weak days on "fox business" at 6 a.m. good morning with maria 6:00 a.m. eastern. follow this program on facebook twitter and instagram to get the latest videos and pictures on the programs i always want to hear from you they tell us what
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you want to hear in this program. i will do it for us today prethanks for joining me. i will see you again next time. >> i'm bob massi. for 34 years, i've been practicing law and living in las vegas, the center of the recent real-estate crisis. lives were destroyed from coast to coast as the economy tanked. now, well, it's a different story. the american dream is back. and nowhere is that more clear than the sunshine state of florida. so we headed from the strip to the beach to showyouhow to live the american dream. i'm gonna meet real people who are facing serious problems, take you behind the gates of properties you have to see to believe and give you the tips that everyone needs to navigate the new landscape. because information is power. and the property man has got you covered. [ woman vocalizing ]


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